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Good Sam sold? Rumor dispelled as Tenet takeover attempt roils

Rumors swirled across Palm Beach today that Good Samaritan Medical Center in West Palm Beach had been sold to another hospital company, but they are nothing more than rumors, said Good Samaritan CEO Mark Nosacka.

“There’s been no discussions abut Good Samaritan being sold, however the rumor is probably linked to the news of CHS trying to buy Tenet,” Nosacka said.

In December, Franklin, Tenn. Based Community Health Systems made a $3.3 billion unsolicited bid for Tenet, and since then, the Dallas company has been taking steps to make itself difficult to swallow.

Those steps include creating a poison pill plan that would dilute the shares of any person acquiring 4.9 percent or more of outstanding stock, as well as postponing its annual investors meeting, putting off the date when new board members could be installed.

A Tenet spokesperson in Dallas underscored Nosacka’s denial: “It’s an absolutely unfounded rumor that Good Sam is for sale. It is not. We continue to make investments in Good Sam, as it is one of our fastest growing hospitals.”

Community Health says its offer is a generous one. It issued this statement on Friday:

“Tenet shareholders should be deeply disappointed that their Board’s response to a compelling 40% premium offer is a double-barreled entrenchment strategy,” the company said. “We are confident that Tenet shareholders will see these steps for what they are: the actions of a Board that is not working for them. Rather than resorting to delaying tactics, Tenet should engage with us in good-faith discussions to complete a mutually beneficial transaction.”

The value of Community Health’s total bid is $7.3 billion in cash, stock and assumed debt, Modern Healthcare’s Vince Galloro reported today.

Community Health was due to make a presentation at the J.P. Morgan Healthcare investor Conference in San Francisco this afternoon. Tenet, meanwhile, held a conference call with analysts to calm any investors who would like the company to accept the offer.

According to the Dallas Morning News, Tenet’s Trevor Fetter said it’s planning to use prior operating losses as a carry-forward to reduce taxes on $2 billion in future earnings, a carry-forward worth $1 a share that will be lost if Community Health acquires Tenet.

Tenet continues to believe that the offer “grossly undervalues” its long-range performance expectations, he said.